Medical insurance: ‘Restore’ option comes with restrictions

One of the most important features of any medical insurance cover is the sum assured. More the sum assured, better are the chances of getting a treatment done properly. According to insurers, the average health insurance claims range between ~60,000 and ~80,000. And only 1-2 per cent claims are over ~300,000.

With such smallclaim sizes, does one buy a policy with, say ~1,000,000 sum assured? For ones who do not want to shell out high premiums, one option is buying a policy with a ‘restore’ option. “In a health insurance plan with ‘restore’ or ‘refill’ benefit, the basic sum insured automatically gets reinstated if it is used up in any given policy year,” says Anand Roy, Executive Director and Chief Marketing Officer at Star Health and Allied Insurance.

In other words, if the policyholder has exhausted the entire sum insured, but have opted for 'restore' option, the insurer will reinstate the full amount. For instance, if you have ~1,000,000 cover and during the year due to accidental injuries you make a claim of ~800,000, it gets settled. Later in the same year, if you incur ~500,000 due to hospitalisation, and make a claim, in a regular policy, only ~200,000 will be paid to you. Under a policy with the ‘restore’ benefit, you will get the full ~500,000 amount.

In case of a family floater, there are higher chances of the ‘restore’ feature getting used. “For a floater policy, if basic sum insured is exhausted by the one insured, others can also benefit from the restored value as each ailment is treated as a new claim for different members,” says Sandeep Patel, Managing Director and Chief Executive Officer at Cigna TTK Health Insurance.

However, in some policies, the restored sum assured can only be used for a fresh claim. “The restore option cannot be used for any illnesses or diseases for which claims have been made earlier,” says Patel. For example, if your previous claim was for diabetes, any further hospitalisation related to diabetes cannot be claimed under the ‘restore’ feature. There are higher chances of an individual falling ill with an existing disease than developing a new ailment, where the purpose of ‘restore’ is lost.

But there are some exceptions. While Star Health Insurance’s family floater does not allow you to claim for the same illnesses in 'restore' policy, it has another option – ‘recharge’ - that allows you to do so. So, while buying one you need to find out all the details. The ‘restore’ benefit is only available for policies of over ~300,000.

For those who want a family floater without hassles, a higher sum insured provides wide coverage and comes with no limitations as compared to the ‘restore’ feature. “In case of a high sum insured plan, the risk exposure is comparatively higher due to a wider scope of usage, and accordingly the premium also goes up,” says Naval Goel, Chief Executive Officer and Founder of PolicyX.com. Opting for a higher sum assured can cost you around ~5,000 extra as compared to 'restore' option. Though the premium is comparatively low for the ‘restore’ feature, it comes with its own set of restrictions. It is important to understand the fine print and choose a policy that provides wider coverage.